PJSC Gazprom has secured a €2-billion, 5-year loan facility with Bank of China Ltd. London Branch in a deal that improves prospects for large projects to export Russian natural gas to China.
Gazprom called the loan “the largest deal in terms of the amount of financing attracted directly from one financial institution and the first bilateral loan facility agreement with a Chinese bank.”
Gazprom has multibillion-dollar agreements with China National Petroleum Corp. to lay two natural gas pipelines, one based on eastern Siberian fields and the other supplied by fields in western Siberia.
With oil and gas prices slumping, the Chinese economy slowing, and Gazprom facing new competition in Russia, both projects have encountered problems.
Development of the western pipeline was suspended last July when the companies couldn’t agree on price.
For the eastern project, Gazprom has sought help with financing, including an advance payment from CNPC to support construction, according to news reports. The Chinese company rejected the request.